A Factual Account of the Tibetan Government’s Gold and Silver

A 72 year old Tsarong arrested by the Chinese for leading the armed
“rebellion" against the Chinese. He returned to Lhasa from India in
early January 1959 to persuade the Dalai Lama to leave Tibet (from Chinese documentary film Putting Down the Rebellion in Tibet, 1959)

Introduction

In a book just published, Mr. Gyalo Thondup says that when my father Dundul Namgyal Tsarong, alias George Tsarong was looking after the Tibetan government’s gold and silver most of the money was lost or stolen. He says that it is still a mystery but suspects that Tsarong may have taken the money.[1] This brief but fully documented account shows that Mr. Gyalo Thondup’s allegations are all false and describes exactly what happened to the Tibetan Government’s treasures.

Brief Account of the Tibetan Government’s Gold and Silver

In the first week of December 1959 Mr. Thondup called Tsarong to Calcutta and told him that the Tibetan government had decided to sell its gold and silver and that Tsarong was appointed as his assistant. He asked Tsarong to arrange air and ground transport and storage areas, which he did. The gold and silver were being brought down from the Gangtok Palace in Sikkim where it had been lying since the time the Tibetan government had it shipped there in 1950. When the gold and silver arrived at Calcutta airport they were taken under police escort as everything was done with the consent of the Government of India. All the gold was stored in bank safe deposits. The boxes of silver were stored at Calcutta’s Bara Bazaar under the supervision of Gyalo Thondup’s man Tashi Tsering.[2] Soon the silver ingots and coins were smelted and made into bars and their fineness stamped at the Indian government mint at Alipore, Calcutta.

The selling of the silver and the gold started at the end of 1959 and the proceeds were put into the Mercantile Bank. Tsarong sent detailed accounts of all transactions to His Holiness’ Private Office. The accounts were sent in the names of Gyalo Thondup and Rimshi Tsarong[3] since Mr. Thondup was the person responsible for the project. Space does not permit me to go into detail suffice it to say that a number of investments were made. These were in companies such as Hindustan Motors, Indian Cable Company, G.M.C Company, Rotas Cement and other companies through L.K. Somani and Abdulla Ganjee. There were loans to Jetmull Bhojraj Bank and Tea Estate. Interest amounts received, sums given to His Holiness and all expenses are detailed. Those interested should see the accounts described in the notes.[4]

With large sums of money in banks and many investments, Tsarong knew a Trust had to be formed for tax reasons. He consulted his lawyers and briefed His Holiness. On February 4, 1964 His Holiness signed a legal document giving Tsarong the authority to form the Trust.[5] This authority was in addition to the legal document in which His Holiness appointed Tsarong as his Constituted Attorney.[6] The Dalai Lama’s trust in Tsarong was unquestioned as the document clearly states that whatever Tsarong did was the same as if the Dalai Lama himself had done it. Mr. Thondup now completely twists the facts saying that since Tsarong was dishonest a Trust was set up and managed by Rinchen Sandutsang, an honest official. As the document shows, the Dalai Lama entrusted Tsarong to set up the Trust. Mr. Thondup says, “Whatever... money we (emphasis mine) were able to retrieve was put in the Dalai Lama’s trust...” Mr.Thondup writes as if he was now involved in retrieving the money and setting up the Trust. As will be shown below, it was Tsarong who was involved in retrieving the money for the Dalai Lama’s Trust.

The money from the sale of the gold and silver earned 3% interest for short term deposits.[7] The newly created Exile Government needed immediate cash, so long term fixed deposits were not feasible. Tsarong was under pressure to look for higher yielding investments which meant more risks. As the documents show, most of the investments were successfully yielding interest except for two in Badla shares. These were investments through Jetmull Bhojraj who were bankers, tea estate owners, miners and store chain owners and Somani Brothers of Calcutta’s Chittaranjan Avenue, Brokers and Dealers in company stock and shares. Documents show that they paid interest for a few years but failed after that.[8]

Since Somani’s investments were guaranteed by Jetmull, Tsarong was now continually chasing Jetmull for the money through endless letters, telegrams and phone calls. A brief excerpt from Jetmull’s K.K. Sukhani says, “My dear Tsarong Sahab..[sic]. Out of one hundred promises I have failed each and every one...but please Sahab [sic] I request you with folded hands to keep my request to allow me time till 10th September... giving my final proposal IN WRITING and this will be the final thing. This will cover Somani also... Please do write to me....”[9]

On September 1 1965 Jetmull’s D.D. and P.C. Sukhani wrote to His Holiness the Dalai Lama. Briefly, the letter said that Tsarong had advanced the money but after the death of their father disputes had arisen among the family members. It also says, “We assure you, Your Holiness that your sacred money is safe and repayment with full interest will be completed in two to three years time.”[10]

Jetmull continued to repay small amounts but Sushil Kumar Somani did not and was sued. The court case was rather uncomfortable for Tsarong since His Holiness’ name would appear as the plaintiff since the money legally belonged to him and his Trust. The court case Suit No 730 of 1969 of the Calcutta High Court was titled His Holiness Jetsun Ngawang Losang Tenzin Gyatso the Dalai Lama and Others Vs Sushil Kumar Somani and Others.[11] Of course Tsarong won the case for the Dalai Lama’s Trust. The fact that Tsarong, as the legal representative of the Dalai Lama, had to go to court to recover the money clearly shows what happened to the money.

Mr. Thondup says that he sent a detailed report to the Private Office on what happened to the money; probably implicating Tsarong. He said he did not get a reply from the Private Office. He is very lucky he did not get a reply. The Dalai Lama knows everything since Tsarong had met him countless times regarding the work and had sent detailed accounts to the Private Office since 1960 onwards.

Mr. Gyalo Thondup brings up another matter regarding a safe deposit box. When Tsarong left his job in 1970 he handed the keys to the empty safe deposit box to Mr. Thondup, his boss. Thirty years later Tsarong was getting bills for the box. He wrote to the Private Office to inform them on the matter and also wrote to Mr. Thondup. Mr. Thondup now found a great opportunity to mislead and cast doubts on Tsarong’s character by saying that Tsarong was trying to implicate him for taking money from the box. Tsarong had already made it known to the Private Office that the safe was empty. Mr. Thondup then says, “But I knew nothing about any safety deposit box and had no key.” However, a document signed by Gyalo Thondup shows that he took out various amounts of gold from the Safe Deposit, Calcutta.[12]

Mr. Thondup also states that Tsarong “...used some of the the money to invest in a pipe factory... run by some Tibetan businessmen.” He writes as if Tsarong did it all on his own and that he or the Private Office knew nothing about it. He says the company failed because of mismanagement. So here is the truth.

In 1959 Prime Minister Nehru had suggested to the Dalai Lama that Tibetans should pool their resources and invest in some enterprises. This was taken seriously by the Tibetan Government and Mr. Thondup also asked Tsarong to look into this matter. Tsarong consulted Mr. J.S. Mehta of the Ministry of External Affairs on starting certain industries. According to a letter, Mr. Thondup himself had written to Mr. Mehta regarding this matter.[13] After many consultations with the industry department a decision was taken to start a steel factory to produce cast iron spun pipes. A collaboration contract was made with Hore Fornue and Company in Belgium.

Tsarong named the company Gayday Iron and Steel Company, headquartered at Calcutta’s 25 Ganesh Chandra Avenue. He purchased some 250 acres at Hirodhi, Bihar where a large factory was to be built complete with railway lines. About 10 Lakh Rupees of the Tibetan Government money was invested. Private investors both Tibetan and others accounted for about Rupees 15 Lakhs, and an 11 Lakh loan was taken from the State Bank of India. Over the years the factory was built and production begun and the Dalai Lama also visited the factory and gave his blessings.[14]

Nevertheless, the factory was plagued with problems and maintaining a successful production became more and more difficult. At the broad level it was India’s problem. The License Raj[15] and India’s socialist policy and bureaucratic red tape suffocated business. Also West Bengal and Calcutta had become nerve centres of violent movements, frequent strikes and monster rallies of the Naxalites and the CPI and the CPI (M), the two competing communist parties; and this hurt the company. It took years to finalize things and by time the machines arrived, prices had shot up and the Belgium collaborators impatient and furious and they never sent their engineers. Once the parts arrived it took forever to get them released from the Babus of the Calcutta customs. As the company grew there was more work, and more technical experts had to be hired, resulting in ever more expenses.

Though these various political and economic struggles impacted business, it was really the October 1962 Chinese invasion of India which had the most immediate impact on the company. The stock market crashed and few bought company shares. The State Bank was also hesitant to loan more money to the company. The invasion lasted only a month, but its effect on the economy was much longer. These were also the reasons that contributed to the failure of the investments mentioned earlier.

With increasing expenses and a very few buying shares in the company, Tsarong convinced the Bihar Government, the Industrial Development Bank of India (IDBI) and the Life Insurance Corporation of India (LIC) to underwrite[16] the shares.

In the summer of 1966 Tsarong went to the United States to see if he could get some money from the State Department. The matter was followed up through William Strangward and his law firm in Cleveland, Ohio; but nothing came of it. The company struggled on producing pipes but was always short of money. Finally, Tsarong had no choice but to ask His Holiness’ help. On October 19, 1968 the Dalai Lama wrote to the Deputy Prime Minister Moraji Desai asking for financial help for Gayday Iron and Steel Company. On November 1968 the Deputy Prime Minister replied saying that the IDBI is prepared to advance Rs. 35 Lakhs but they wanted the right to appoint their own Directors.[17] They said that the company’s problem was due to inexperienced management. That was not the problem however, because even with experience directors nominated by the IDBI, the company struggled on and finally closed in 1978. Father had resigned in 1970.

Gyalo Thondup Slanders the Tsarong Family

Mr. Thondup now tries to malign Tsarong through the method of vilifying earlier generations of the Tsarong family. He says that the original Tsarong (Minister Wangchuck Gyalpo) was assassinated since he was “too pro-Chinese.” Mr. Thondup does not mention that the Dalai Lama appointed Tsarong to look after things at Lhasa while His Holiness and his entourage escaped to India. This was in 1910 when Lhasa itself was occupied by Chinese troops. As far back as 1904, Minister Tsarong believed in rapprochement with the Chinese as opposed to a more independent course of action with outside support. Does this sound familiar today? Yes, Tsarong was more than one hundred years ahead of those who today espouse a similar policy towards China.

Mr. Thondup also says that George Tsarong’s father Tsarong Dasang Dadul (hereafter Tsarong) was a big thief. He says that Tsarong was just some commoner and became part of the aristocracy when he married into the Tsarong household. Mr Thondup forgets that Tsarong was already a Letsenpa, a Fifth Rank government official in 1908, many years before he married into the Tsarong family.[18]

Mr. Thondup tries to portray Tsarong as someone who was going to be tricked by the British into starting a military coup in Tibet. He says that Tsarong was invited by the British Governor General and the Dalai Lama was sort of suspicious and so he sent Lukhang to spy on Tsarong. The truth is that Tsarong was not invited by the British. The Dalai Lama had granted him a pilgrimage cum work leave and the day he left home for India he stopped by to see the Dalai Lama. They spent many hours discussing and on that day Tsarong and his family only managed a journey of 5 miles when the daily average ride was close to 20 miles. Tsarong spoke to the Dalai Lama about inspecting Norbu Tsukyi mint near Sikkim and then going to India to speak to the British about military training.[19] According to a letter sent by the Kashag to the British, the ministers wrote that Tsarong is also presently in India and that he might also remind them of the need to levy customs duties to support the Tibetan military.[20] So Tsarong was also on official duty and that is why Lukhang was sent. Every cabinet minister was appointed a Gakpa, an ADC who must accompany the minister wherever he went and Lukhang was Tsarong’s ADC.

Mr. Thondup also says that when Tsarong and his military entourage returned from India the Dalai Lama sent a messenger near Phari Dzong demoting Tsarong as Commander-in-chief. The fact is that Tsarong never left or returned to Lhasa with a military entourage but travelled with his wife, his 4 year old son, nanny Ani Chungkyi and a few servants. Tsarong was relieved of his Commander-in-chief position when he arrived at Chushul, near Lhasa. Mr. Thondup forgets to mention that the government demoted all the senior officers of the Tibetan army including Tsarong to satisfying the conservatives who were against Tsarong’s modernization programs. [21]

Mr.Thondup also says that the Dalai Lama removed Tsarong as minister of the Kashag and “Henceforth, he was nothing more than an ordinary official” and “... Tsarong was never given another official appointment.” The fact is that the Dalai Lama never removed Tsarong from the Kashag and he continued to be a minister for many years after that. In 1931 the Dalai Lama officially appointed Tsarong to assist Thubten Kunphel at the Drapchi Office. Tsarong continued to be a high ranking official with Dzasa rank; same Third Rank as the ministers. Tsarong was also the most outspoken and senior-most leader in the National Assembly until the 1959 Uprising. In 1954, the government under the present Dalai Lama appointed Tsarong to head the Development Office (Zuktrun Lekhung) in which he worked till the end.

Tsarong was in India a few months before the 1959 Uprising but returned to Tibet to propose to His Holiness that he should leave Tibet. The Dalai Lama confirmed this in one of my interviews with him.[22] When the Lhasa uprising began the people of Lhasa choose Tsarong as one of their leaders as they had full trust in him, and respected his experience as a former and successful commander-in chief of the Tibetan army.

As a people’s representative, Tsarong soon learned that the Dalai Lama had escaped from Lhasa because Minister Surkhang’s letter to the assembly said so. The assembly wanted Tsarong to stay and guide them. He did so fearlessly. A few assembly delegates immediately fled to India right after that meeting adjourned. Tsarong set up his HQ at Shol and attempted to direct the fighting in Lhasa. After enduring continuous Chinese artillery fire for two days, he was captured and imprisoned at Chinese Military Headquarters Prison. He died a few months later under mysterious circumstance. His fellow prisoners believed that the Chinese had him quietly killed in prison so that he could no longer serve as an inspiration for resistance.

Mr. Thondup continues his denigration of this great Tibetan hero and says that Hisao Kimura, a Japanese spy, “told me” that Tsarong kept a printing press in his house to print money and that explains why Tsarong got so rich. Hisao Kimura’s biography has nothing but high praise for Tsarong saying that “Tsarong represented the best of the old generation of Tibetan nationalists.” and that he was “known for his open-mindedness … and was always attempting to introduce new scientific innovation in conservative Lhasa”. Kimura concludes: “I held this man in the deepest respect.” [23] There is not a single word about Tsarong keeping a printing press in his own home.

Anybody who knows anything about how traditional Tibetan Government offices functioned will see that what Mr.Thondup says is just not possible. Printing the paper money of Tibet was a big operation that just could not be done at home. The Drabchi Office which printed Tibet’s currency was headed by Thubten Kunphel, the 13th Dalai Lama’s chensel [24] and the most powerful official of his time. He was assisted by many officials. One of them was Tsarong with Dzasa Third Rank. There were other Fourth Rank officials with Rimshi, Tsepön and Drunyichemo designations. Below them were fifteen other Fifth Rank officials and a large staff under them.[25]

To print money the senior officials discuss procurement of the materials such as papers, ink colours, spare machine parts, the quantity to be printed and even minute details as the colour and design of the money. They take their memorandum to the Kashag and a document is drawn up. This document must be submitted to the Regent/Prime Minister’s Office and from there to the Dalai Lama, who makes changes if any in red ink and marks it as “Seen”.

Only then can the Kashag give the order to Drabchi office to print money or order materials.

Technologically, Drabchi Office had numerous machines for lathe work, stamping, rolling and printing machines. Electricity was supplied from the Dhodey Hydroelectrical Station which had a substation at Drabchi with an AC motor driving a DC 220 volt motor.

Various items necessary for printing were kept in storerooms and looked after by Fifth Rank officials. Every evening the storerooms were locked and sealed. All office seals and printing seals were locked in a seal box. Every morning a senior officer comes to inspect the seals. Only then can the storeroom be opened. The daily accounts book, the seal box, etc, can are only opened when all the senior officials have gathered. The office had calligraphers; scribes specially recruited from Aye in Southern Tibet for any work regarding the writing of texts and numbers for printing. The above account proves, without any doubt, that no single individual in Tibet could ever print money.

Nevertheless, Mr. Thondup says that Tsarong got rich by printing money at home. Now it is common knowledge how Tsarong made money. Tsarong engaged in traditional trade and business just like the traders and monastic institutions. Tsarong shipped wool to India and brought back cloth, dye and numerous other items. Like large traders and monastic institutions Tsarong also loaned money. From the eastern frontier Tsarong was involved in the tea trade and bought horses and guns from Sinning.

Tsarong also bought boxes of coral and amber from an Italian dealer in Calcutta and Rolex and Omega watches from Mr. M.L. Bhatia of J. Bosek and Company on Calcutta’s Chowringhee Street. Heinrich Harrer mentions in his book about helping Tsarong write letters to these companies. Not far on the same avenue was the jewellery shop of M.Walters from whom Tsarong bought diamonds, sapphires, ruby and emeralds for family use and for sale. Tsarong also bought much jewellery from Bombay. From Calcutta Tsarong also bought bicycles, BSA motorcycles, jeeps, a Land rover and even a Bedford Truck. He sold some of these. That’s how Tsarong got rich.

What more can I say on Mr. Gyalo Thondup’s defamatory statements about two generations of the Tsarong family? Let me just conclude by stating how unfortunate it is that the Dalai Lama’s older brother should make such derogatory and baseless accusations against two of the Dalai Lama’s own trusted and loyal officials: one who served him in exile in the most difficult of times, and the other who saved the life of the 13th Dalai Lama, and fought and died in 1959 to ensure that the 14th Dalai Lama escaped to freedom.

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NOTES:

[1] Gyalo Thondup and Anne F. Thurston, The Noodle Maker of Kalimpong: The Untold Story of My Struggle for Tibet, (Vintage Books, 2015) See pages 214-219 on the Tibetan Government’s gold and silver and on Tsarong.

[4] Account 1959-61, Account 1962, Account 1963-65. These and all other documents of George Tsarong have been sent to various institutions and libraries, including the Library of Tibetan Works and Archives, Songtsen Library and to various interested individuals.

[5] Document HHDL Trust, February 4, 1964

[6] Tsarong’s February 8, 1963 letter to the Government of India, Excise Inspector shows that Tsarong was the Constituted Attorney of His Holiness the Dalai Lama.

[7] See the Accounts in Note 4

[8] Ibid.

[9] K.K. Sukhani Letter, August 9 (1964), pages 1-4.

[10] Jetmull September 1, 1965.

[11] Document July 22, 1969. Tsarong interview, 2000, Dharamsala.

[12] Safe Deposit, February 12, 1961. Signed memorandum of Gyalo Thondup and Tsarong.

[13] Gyalo Thondup letter 3-10-1960

[14] Dundul Namgyal Interview, Dharamsala, 2000.

[15] Under the License Raj few got licenses to do business and the government had total control over the economy.